Enzymes are released from the hyphae's surface. They break down remains of dead plants and animals. Nutrients are liberated and absorbed by the hyphae.
Also plant roots absorb much of the released nutrients, which are very important to them. Next to bacteria, fungi are the most important decomposers in nature.
The mushrooms we pick in the autumn are actually the fungi's "fruit bodies". They grow out from the mycelium. A number of tiny spores are produced in the fruit bodies. The spread of spores The spores detach from the fungus, and are carried away by the wind to places where they can grow into new mycelia.